Selecting effective financial instruments to support action on climate change
This low emission development strategies (LEDS) Finance Resource Guide presents a curated selection of resources on a range of topics around finance for LEDS and Nationally Determined Contributions (NDCs). It is designed to help LEDS practitioners find high-quality resources that meet their specific needs, avoiding time-consuming searches on the internet. It will be useful to individuals working on, or interested in, LEDS and NDC finance in both developed and developing countries.
- 1. Understanding the situation
- 1.1 Understanding current flows
- 1.2 Assessing financing needs
- 1.3 Assessing capacity
- 1.4 Identifying and overcoming barriers
- 2. Planning and coordinating
- 2.1 Institutions and governance
- 2.2 National finance strategies
- 2.3 Investment plans
- 2.4 National climate funds
- 2.5 Green investment banks
- 4. Using public finance
- 4.1 Managing national finance
- 4.2 International climate finance
- 4.3 Climate finance readiness
- 4.4 The Green Climate Fund
- 4.5 Direct access
- 5. Designing financial instruments
- 5.1 General resources
- 5.2 Sources of private finance
- 5.3 Risk mitigation
- 5.4 Guarantees
- 5.5 Feed-in tariffs and auctions
- 5.6 Taxes and tax incentives
- 5.7 Carbon pricing
6.4 Measuring, reporting and verification
Good projects will be designed with consideration of how their impact can be monitored and evaluated, to provide information on how to improve project performance, to check whether the desired results are being achieved, and to provide lessons for future project development. In the international arena of climate negotiations and international climate finance, this has additional significance in the form of measuring, reporting, and verification (MRV), now referred to under the Paris Agreement as ‘transparency’. MRV is relevant at the project level as well as at national and international levels, and many providers of international climate finance require MRV to be built into project design from the outset and for information to be provided on this in project proposals. The resources in this section provide some introductory guidance on how to incorporate MRV into project design.
This introductory paper aims to clarify the different types of MRV relevant to climate mitigation. It covers three types—MRV of emissions; of mitigation actions; and of support. MRV of mitigation actions, covered in section 2.2 of the paper, is most relevant here. The publication is aimed at national decision makers and practitioners from environmental and development organizations with no or little prior knowledge. It does not provide detailed guidance on implementing each type of MRV, nor does it cover monitoring and evaluation of adaptation efforts. The aim is that this paper will enhance understanding of the landscape of MRV, the ways in which different types of MRV fulfill particular needs and utilize respective methodologies, and the synergies among them.
Guidance for NAMA design in the context of NDCs: A tool to realize GHG mitigation under NDCs (Chapter 7 Quantifying the Impact of NAMAs: pp. 55–70)
This guide, updated in 2016, aims to support developing countries in the NAMA development and implementation process by providing guidance and good practices on the key aspects of NAMAs, and provide insights on how NAMAs may support NDCs. For further information on this tool see Featured resources in section 6.
Greenhouse Gas Protocol Policy and Action Standard: An accounting and reporting standard for estimating the greenhouse gas effects of policies and actions
The Policy and Action Standard provides a standardized approach for estimating and reporting the change in greenhouse gas emissions resulting from policies and actions. The primary intended users are analysts and policymakers considering or designing government policies and actions at any level: national, state, provincial, or municipal. The Standard was designed to help users estimate the greenhouse gas effects of planned policies and actions to inform decision making, monitor progress of implemented policies and actions, and retrospectively evaluate greenhouse gas effects to learn from experience.